China Mobile expected to launch 4G service with iPhone 5s/5c on December 18

The world's largest carrier by subscriber count, China Mobile, announced plans to launch a new brand for mobile service December 18 during its 4G Global Partners Conference. The move is expected to coincide with its launch of Apple's latest iPhone 5s and 5c models.

A report by Lorraine Luk of the Wall Street Journal cited Mizuho Securities analyst Marvin Lo in Hong Kong as stating that "a deal with China Mobile would give Apple a big boost in the China market as the largest local carrier has the most wealthy subscriber base.

"I estimate that among China Mobile's more than 700 million mobile subscribers, at least 10% or 70 million wealthier ones would be potential customers for iPhones," he added.

China Mobile will launch its 4G network using the nation's home grown flavor of LTE known as TD-LTE. The carrier technology is incompatible with existing 4G LTE, an attempt by China to avoid paying patent royalties to Qualcomm, much as it earlier did with its "TD-SCDMA" version of 3G service.

Apple's iPhone 5s and 5c expressly include support for TD-LTE, and the two models were approved by China's Telecom Equipment Certification Center in early September.

The two new iPhones are among a small minority of devices capable of working on China Mobile's 4G network and licensed by the state to do so.

This is HUGE news. Another, say, 50M iPhones would mean an extra $30B in revenue, perhaps $6B - $7B in additional profit, and at a conservative P/E of 11x, 66B - 77B in additional market cap, or ~$75 - $85 in stock price.

Even allowing for the fact that some of it has been discounted by the market, I wonder why the after-hours price is still sideways....

Never expect the stock market to act in what you or I might consider a rational manner. With the massive mix of large institutional investors, longs, shorts and self-serving analysts all working at cross-purposes, expect more of the same.

Agreed, but also others may jump ship from Unicom and Telecom to get on Mobile's 4G network.

I don't know if something got lost in the translation in this report, but my experience in China is that China Mobile has the broadest coverage and covers all the rural areas and I would have expected them to have the lowest proportion of high income earners (the percentage on 3G, much lower than on Unicom and Telecom would corroborate this). In terms of absolute numbers, they probably have the higher number, but I would think that 10% seems a bit on the high side? Maybe it's all the CPC members!

Don't count on them saving shipping costs... we recently sold a product in Australia to a person who travelled from Vietnam to Australia to buy the product and can you guess where the product is made...

Never expect the stock market to act in what you or I might consider a rational manner. With the massive mix of large institutional investors, longs, shorts and self-serving analysts all working at cross-purposes, expect more of the same.

its not an official announcement yet, CNBC didn't mention it so its still under the radar. To top it off its in option sellers best interest to down the stock as much as they can for monthly opex tomorrow.

Would be nice to have an official news tomorrow and a big pop, the stock manipulator would lose a lot of money.

True, but China Mobile is building out the 3G network. Until recently that service was much smaller.

Quote:

Originally Posted by JamesMac

Agreed, but also others may jump ship from Unicom and Telecom to get on Mobile's 4G network.

I don't know if something got lost in the translation in this report, but my experience in China is that China Mobile has the broadest coverage and covers all the rural areas and I would have expected them to have the lowest proportion of high income earners (the percentage on 3G, much lower than on Unicom and Telecom would corroborate this). In terms of absolute numbers, they probably have the higher number, but I would think that 10% seems a bit on the high side? Maybe it's all the CPC members!

While China Mobile has the broadest coverage, the 3G coverage is relatively new and is being built out rapidly. What I do not know, but I would highly expect, is that China Mobile has their 3G coverage concentrated in metro areas... as that would require the fewest number of towers to gain the most users.

"That (the) world is moving so quickly that iOS is already amongst the older mobile operating systems in active development today." — The Verge

its not an official announcement yet, CNBC didn't mention it so its still under the radar. To top it off its in option sellers best interest to down the stock as much as they can for monthly opex tomorrow.

Would be nice to have an official news tomorrow and a big pop, the stock manipulator would lose a lot of money.